In a war that requires the best rhetoricians, Apple lacks. In Steve Jobs, David Einhorn had a more-than-worthy battle partner. In fact, if Steve Jobs were alive, my guess is that Einhorn would not have charted the present course. If he did, Jobs would never have let it get to this. He would have shot the whole thing down before it turned into such a massive issue.
Tim Cook calls this thing a sideshow, but it's his fault it is one. Within the context of how it plays out in the media and, subsequently, with shareholders (because that's what matters, not what the court says) Einhorn outwits Cook by a mile.
In a Thursday night email conversation
(after his iPrefs presentation, but before the court ruling), Einhorn told me: "Proper capital management is not in conflict with an innovative product culture, which we believe will continue to persist under Tim Cook."
That's little more than an extension of the
show presentation Einhorn gave last week where,
as I explained Friday
, he painted Apple, particularly Cook, into an unworkable corner.
It's all too masterful; Einhorn adapts Jobs' reality distortion field and presents iPrefs as an idea only a stubborn egomaniac who hates his company's shareholders could oppose. That's why -- mark my words -- Apple will, sooner rather than later, cave like a house of cards.
Einhorn won this battle. There's no way out for Tim Cook because he let this thing go too far in the first place. Now, pretty much all Einhorn has to do is sit back and wait.
Issuing the preferred stock and paying the dividend on it -- that's secondary.